Certified Government Financial Manager (CGFM) Practice Exam 2026 - Free CGFM Practice Questions and Study Guide

The process referred to for the cancellation of budget authority proposed by the President is known as "rescissions." While rescissions may not be listed as an option in the provided choices, the closest terms and concepts can help clarify the subject.

Deferrals refer to a temporary postponement of budgetary resources that can delay the expenditure of funds but do not cancel budget authority. Supplemental appropriations involve additional funds requested by the President to cover shortfalls or increased funding needs but do not pertain to the cancellation of existing authority. Allotments are a method of distributing budget authority within an agency after an appropriation has been made, rather than canceling it.

Understanding the correct terminology is crucial for mastering federal budget processes. Rescissions are specifically linked to the cancellation of funds, illustrating the President's power to propose changes to budgetary authority and the effect it has on the overall federal budget and agency funding. Thus, it's essential to differentiate between these terms to grasp the mechanics of government spending fully.